Nature and adaptation to be considered for corporate net-zero transition standard
The Transition Plan Taskforce (TPT) has called on corporates to publish their transition plans for reaching net-zero this year, while also unveiling new members to the initiative and exploring how nature, adaptation and a just transition can be included.
The TPT was launched by the Treasury in April 2022, with a pledge that large businesses in high-emission sectors would be subjected to new net-zero disclosure requirements from 2023. The requirement is around net-zero transition plans, which support long-term corporate emissions goals with interim milestones and outline the necessary steps to change business models and investment. Plans should also detail how workers will be supported and the need for upskilling and reskilling addressed.
It issued its first proposal for a ‘gold standard’ for net-zero transition plans six months later. The proposal consists of a framework, recommending how companies should develop plans and the key elements they should include; and an implementation guidance document. The guidance includes advice on when, where and how to provide net-zero transition plans.
The TPT is proposing that companies should have to publish one transition plan this year, then an update in 2026. In 2024 and 2025, information material to the plan should be included in financial reporting.
Following its first major event of the year at the Guildhall this week, the TPT has sent out a new call to action for corporates to publish plans this year.
The TPT’s co-chair and group chief executive of Aviva, Amanda Blanc said: “Momentum is building on transition plans but this will only be sustained by firm action, a will to change and our ability to think beyond our own businesses. The TPT is there to help – not only through guidance, but also by connecting businesses together.
“I hope in 2023 we will start to see transition plans at every level – with companies, countries and international institutions setting out their routes towards a net-zero future.”
The TPT has confirmed that feedback to the existing proposal called for more guidance on how transition plans can link to and account for wider sustainability issues such as nature, adaptation and a just transition. New working groups will be set up to explore these areas and whether they can or will be included in future TPT frameworks.
The TPT has also announced new members and observers of a “delivery group” as well as a new phase of a “sandbox” accelerator to help corporates aiming to deliver and use transition plans. The TPT will accelerate new capabilities to support investors, banks and firms through this sandbox.
New members are Diageo, SSE and Railpen. New observers are the Department for Environment, Food and Rural Affairs, the Department for Work and Pensions, the Department for Business and Trade, the Financial Reporting Council, and The Pensions Regulator.
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